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How can CIOs Maximize Enterprise Application Investments?

Rajesh Rao

Rajesh Rao, AVP and Global Head - SAP practice, Infosys, discusses how IT enables companies to achieve faster time-to-market and implement their business strategies. According to him, standardization of operating procedures and data enables companies to address Flat World challenges.

Q.What are the biggest trends in Enterprise Applications?

A.Globalization, centralization and compliance are driving the IT agenda of CIOs and CXOs worldwide. Similarly, enterprise application, legacy application modernization and Service-Oriented Architecture figure among the top 10 technology priorities of CIOs.

Clients are facing multiple challenges that need to be resolved within tighter budgets and timeframes. IT and specific package applications can play a crucial role in addressing challenges:

IT should enable businesses to achieve faster time-to-market and realize business strategies. As a result, the demand for an agile and responsive IT has gone up more than ever before.
IT should be the backbone on which enterprises achieve data and process harmonization.

Standardization - of operating procedures and data - empowers enterprises to address these challenges. Unlike customized, handmade and expensive enterprise solutions of the past, Infosys helps enterprises extract more pre-configured and assembled solutions, encompassing the best practices in the industry. The delivery of these solutions will be driven by accelerators, SOA and tools for IT industrialization. For example, many tasks in a global SAP deployment project are executed manually - which is effort-intensive and error-prone - though there is scope for automation.

Infosys has been strategically investing in tools, reuse and productivity initiatives and is well positioned to deliver value. In fact, most of our client engagements are within budget, on-time and meet the expectations - both business and technology - of our customers. We are now scaling up our efficiencies even further to help customers meet their business objectives better.

Q.You head the SAP practice within Infosys. What are the differentiators that make Infosys' SAP practice stand out against your competitors? What can customers expect from you for SAP ERP services?

A. At Infosys, we focus not only on project-related parameters - like execution within budget and on time - but also on the business impact.

The focus of our SAP practice is to deliver enhanced business value, and offer attractive and innovative business/engagement models that give customers the ability to stretch their business goals. Our ability to deliver global transformation engagements by leveraging the products in the SAP eco-system has made us the partner of choice among global clients.

We have deepened our knowledge of industry verticals and improved the methodology to leverage our internal and SAP-delivered best practices. Most of our recent implementation engagements have a risk-reward clause where we link a part of our fees to the outcome of the project. We have also developed legal and contractual models to support these risk-reward clauses linked to the value realized.

We also offer end-to-end business process services based on SAP as a platform through our Business Platforms. The platform covers BPO, application maintenance and infrastructure services. It has already been launched for the P2P (indirect) function. We have developed an indirect pricing model based on client spend. Other areas are being explored jointly with SAP.

Our ability to funnel back our investments in vertical expertise, solutions and SAP technologies into business value for customers with consistent improvement on quality and timeliness make us the preferred partner for global SAP consulting and implementation services. A leading analyst research firm has recognized us as a leader in SAP services

We are now competing with global players and our rollout story is getting stronger. As a strategy, I believe we are very robust as we continue to enhance the quality and nature of our engagements. We have very high on-time and within-budget delivery metrics and that extends to the SAP practice as well.

Our ability to cater to the globalization, centralization and compliance priorities of CIOs and CXOs enables us to offer solutions at par with global players along with a delivery excellence and cost advantage.

Q. How is Infosys influencing SAP products and economy to drive innovation that benefits customers?

A. Our SAP alliance is very strong as we continue to collaborate and align with SAP's future growth strategy, including its Enterprise SOA vision. The SAP product suite now offers a platform for Infosys to develop point solutions. These point solutions provide differentiation for us as well as enable non-linear growth. Infosys' several solutions are SAP-certified such as the pre-configured SAP all-in-one-based solution for the Independent Software Vendor (ISV) industry.

We are exploring new market segments, working on alternative pricing models and results-based pricing. For example, we harmonized processes and data for a global automobile manufacturer and reduced its order-entry-related errors from 3% to 0.8%. A payout of our fees was dependent on that result. In another case, when upgrading seven instances of SAP for a Pharma major, we committed zero unplanned downtime during go-live and put at stake, a significant part of our fixed-price on that result.

We are investing in solutions for micro-verticals which lend themselves to a standard out-of-the-box SAP-based solution. We invest in innovation which is relevant to the customer and nurture it for sustained business results.

Q. How does Infosys work with customers to leverage and maximize value from their existing ERP investments? What is Infosys' investment in innovation that enables ERP customers to derive value from investments?

A. In a standard implementation engagement, we focus on meeting scope, being functionally effective and going-live meeting budget and time objectives. There are several opportunities to extract value - both in driving business process efficiency and in IT efficiency - after the initial ERP implementations.

There are many ways to engage and enhance value from existing ERP investments and there are many system improvement-related topics such as performance tuning and data management that we work on. Upgrades are another big area and we have developed a solution that eliminates all the uncertainties around upgrades. We also have introduced the concept of "collateral benefits" during upgrades to enhance the value of the offering.

Data harmonization is one of the biggest areas where efficiencies can be improved. It includes process consulting relating to Master Data Management (MDM) and implementation of MDM solutions. Data harmonization is a pre-requisite before other key initiatives such as business process harmonization, shared services etc. can be considered. Also, process harmonization - with ERP instance consolidation as the vehicle - is another area of investment. It allows companies the option of centralization and creating shared services for certain functions.

Such multiple small efficiencies help maximize the value of existing ERP investments. It is a mindset change by moving from maximizing ROI to enhancing total economic impact.

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